Foreign Policy Blogs

Is California changing its tune on offshore drilling?

In a move that went widely unreported last week, California Governor Arnold Schwarzenegger unveiled a plan that would allow additional drilling within state waters in an attempt to help ease California’s fiscal troubles. California had banned new exploration activity within state waters (an area that roughly extends nine miles from the coast) since the 1969 spill in Santa Barbara — although there has been ongoing production in existing sites within state boundaries.

This proposal, like the previous one in Florida, is all about money as the states grapple with budget shortfalls. California expects the legislation could bring in over $1.8 billion over time. The proposals also show how quickly two states which were adamant against lifting the drilling moratorium in federal waters less than a year ago could change their opinion.

California’s decision to allow offshore drilling would be a boon to the exploration industry, especially if the state supported opening up federal areas beyond state waters. Those regions have substantial proven reserves: roughly 2/3 of all proven supplies on the US’s outer continental shelf.

 

Author

David Abraham

David S Abraham has expertise in the analysis of geopolitical and economic risk as well in energy issues. At the White House Office of Management and Budget, his work included overseeing natural resource and foreign assistance programs, and serving on the interagency trade policy committee. In his previous role as a sovereign risk analyst with Lehman Brothers, subsequently, Barclays Capital, he advised the firm on geopolitical and economic risks in developing countries. He has also consulted for a variety of organizations including the United Nations Support Facility for Indonesian Recovery, RBS Sempra Commodities, ClearWater Initiative and a small German consultancy. David earned degrees from Boston College and The Fletcher School at Tufts University and proudly served as a Peace Corps Volunteer. His written work has appeared in a variety of publications, most recently in The New York Times, The Providence Journal, and CFR.org. He speaks Lithuanian and is a Term Member at the Council on Foreign Relations.

Area of Focus
Geopolitics; Economic Risk; Energy Issues

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